Budget LIVE: Defence allocation is Rs 2,46,727 crores, says Jaitley

[PARIKRAMA]

i like how ppl are fighting over some claims like LCA MK2 , a bird on paper and not even a proto ready.. Its interesting to see and understand where is the money which will be needed to be used for acquisition of multiple systems and force multipliers,,, As usual, its true that GOI smartly had put resource allocation prioritised to states to boost the tangible infrastructure and skill based employment increase.. of course this will definitely ease the burden as return from this boost in years to come will ultimately prove to be the bud for reaching high growth rate of 10% plus.

But interestingly and even to the worst contrarian view that all deals wont be signed and scrapped for lack of money allocation, that thought will succeed if and only if the trade dependency and economic inter woven industries make the theaters of threat beaten to lowest of the priority. In simple words, if India makes peace with neighbours - Pak/China and all these economies are so inter linked that any kind of possible threat from any of the country may lead to such instability in economic front which in turn means no such threats would be allowed to exist at first place. Thus, my views state that since this situation is at present not possible, and on top our all 3 arms of defence needs more capable modernisation to meet the present uneven situation, it is imperative that defence budget allocation for new purchases would be there in some form. This form would be release of additional funds on prioritizing basis and meant to be used for the best possible resource allocation among the 3 arms.

So anyone who feel that MMRCA or Chinooks or Apaches or A330 or other deals wont be signed is living in a delusion. Only thing to be seen is A) timing.. B)how the new procurement policy changes the whole setup as of now which may lead to faster deal finalisation and less chances of price escalation. Of course point B wont matter much this FY. But point A definitely based on priority would would see the movement.

For MMRCA, the veterans can/ may be answer this. If India is offered a good bank financial deal backed by French Government how does that matter to defence allocation issues? What i mean is French Banks are there in India and instead of 15% we can end up paying say 3% and rest 12% upfront fee may become a soft loan via France. Its just a thought but then such kind of structures are always a possibility.. is nt it? we saw it a Gov to Gov level with Egypt (of course no TOT). That does not mean financial support may be completely absent with India.. Similarly for US based deals too.. After all all are sizable deals and back home it brings lots of cheers to their home economy (including financial charges for soft loans) and employment..

 

[sancho]

Its called Fiscal prudence. Target being to reduce our Fiscal deficit from 4.1 % of GDP to 3.9 % and this year to 3.6 % the year after than to 3.1% for year 2016-17.

Not really, since the budget revised the aim of 3.6% back to 3.9%, which means the government takes more loans and increases the fiscal dept. The interesting part is, that the whole money that they take additionally, is not accounted so far and goes to the non planned expenditure part of the budget. No idea what the government plans with it, but it shows, they have went away from the Fiscal prudence aim of the first budget and if they spend it wisely, I would fully support it, because this is the time to spend and take benefit of the weakness of other countries.

 

[Guynextdoor2]

Parrikar commenting on the overall budget, but doesn't say anything on the defence budget.



@ all, please stick to topic and ignore troll posts!

You know that education is getting cut? And no @janon state transfers were another jalebi that was cooked up by Fenku. As per news report in TOI today, 10% shift of money to states is 'non existant'. I don't know any budget before where education was cut while we make statues for 2500 crores.

 

[MokshaVimukthi]

Not really, since the budget revised the aim of 3.6% back to 3.9%, which means the government takes more loans and increases the fiscal dept. The interesting part is, that the whole money that they take additionally, is not accounted so far and goes to the non planned expenditure part of the budget. No idea what the government plans with it, but it shows, they have went away from the Fiscal prudence aim of the first budget and if they spend it wisely, I would fully support it, because this is the time to spend and take benefit of the weakness of other countries.

Govt. merely revised its OWN Target of reaching 3.1% by one additional year. Modi govt. had set a target to reach 3.6 % this year but that was revised to 3.9% to provide more money for Infrastructure spending.

Congress govt. had taken our Fiscal deficit to 6.1% of GDP .... din't see you complaining then.

The planed expenditure is kept low to provide wriggle room in case oil prices go up. That way we still reach our fiscal target even in bad times. That is prudent planing, so Yes, we DO have an idea what they are planing to do with it.

Inflation target has been raised to encourage growth and revenue deficit is at 2.8% which is reasonable considering we have reduced corporate tax. I see no reason to worry.

 

[magudi]

You know that education is getting cut? And no @janon state transfers were another jalebi that was cooked up by Fenku. As per news report in TOI today, 10% shift of money to states is 'non existant'. I don't know any budget before where education was cut while we make statues for 2500 crores.

It is not just education, most other social sectors also saw cut. And even with a 10% increase in revenues to the states the net centre to state transfers will remain same as it was earlier

 

[Guynextdoor2]

It is not just education, most other social sectors also saw cut. And even with a 10% increase in revenues to the states the net centre to state transfers will remain same as it was earlier

@janon

'Not much for States in Finance Panel'

http://epaperbeta.timesofindia.com/index.aspx?eid=31805&dt=20150302
http://epaperbeta.timesofindia.com/index.aspx?eid=31805&dt=20150302

 

[INDIAPOSITIVE]

https://twitter.com/x/status/572399174219530240

 

[sancho]

You know that education is getting cut? And no @janon state transfers were another jalebi that was cooked up by Fenku. As per news report in TOI today, 10% shift of money to states is 'non existant'. I don't know any budget before where education was cut while we make statues for 2500 crores.

Yes, I just wen through this interview with former FM Chidambaram, which is very informative, since he actually have a clue of the matter and the things behind it and it's great how he makes the moderator stump several times with simply explaining things based on what he knows:

| Video | Union Budget has simply abandoned the poor, says P. Chidambaram | India Videos | - India Today

The point however is, that the government has chosen to give more here, cut things there and as the defence budget is the topic here, give only a very small increase for the MoD. That, while the economy is in good shape and while they are lending more money, so it's not like they didn't had more money to spend on defence, but they chose to limit it and that's what I am criticizing. It simply makes no logical sense, to increase the defence budget last year with less GDP prospect and more focus on the fiscal deficit, far beyond the level they do it now, when they know they will have more revenues and when they are getting more loans anyway.

Modi govt. had set a target to reach 3.6 % this year but that was revised to 3.9% to provide more money for Infrastructure spending.

That's what I said and which is contradicting your earlier statement about fiscal prudance and no, they are not spending it on infrastructure, since the additional money is not allocated to the planned expenditure. Btw, please don't go to party politics about it, since that is not the issue here, but if more money should had been given for defence and if the ammount that was given is enough.

 

[Guynextdoor2]

Yes, I just wen through this interview with former FM Chidambaram, which is very informative, since he actually have a clue of the matter and the things behind it and it's great how he makes the moderator stump several times with simply explaining things based on what he knows:

PHOTOS: Arun Jaitley’s Union Budget 2015 explained in graphs, BSE Sensex and more | The Financial Express | Page 3

The point however is, that the government has chosen to give more here, cut things there and as the defence budget is the topic here, give only a very small increase for the MoD. That, while the economy is in good shape and while they are lending more money, so it's not like they didn't had more money to spend on defence, but they chose to limit it and that's what I am criticizing. It simply makes no logical sense, to increase the defence budget last year with less GDP prospect and more focus on the fiscal deficit, far beyond the level they do it now, when they know they will have more revenues and when they are getting more loans anyway.



That's what I said and which is contradicting your earlier statement about fiscal prudance and no, they are not spending it on infrastructure, since the additional money is not allocated to the planned expenditure. Btw, please don't go to party politics about it, since that is not the issue here, but if more money should had been given for defence and if the ammount that was given is enough.

which channel was that interview in?

 

[sancho]

which channel was that interview in?

Not sure, check the video in the link. Sorry, corrected the link.

 

[magudi]

which channel was that interview in?

Cnn-ibn

Yes, I just wen through this interview with former FM Chidambaram, which is very informative, since he actually have a clue of the matter and the things behind it and it's great how he makes the moderator stump several times with simply explaining things based on what he knows:

| Video | Union Budget has simply abandoned the poor, says P. Chidambaram | India Videos | - India Today

The point however is, that the government has chosen to give more here, cut things there and as the defence budget is the topic here, give only a very small increase for the MoD. That, while the economy is in good shape and while they are lending more money, so it's not like they didn't had more money to spend on defence, but they chose to limit it and that's what I am criticizing. It simply makes no logical sense, to increase the defence budget last year with less GDP prospect and more focus on the fiscal deficit, far beyond the level they do it now, when they know they will have more revenues and when they are getting more loans anyway.



That's what I said and which is contradicting your earlier statement about fiscal prudance and no, they are not spending it on infrastructure, since the additional money is not allocated to the planned expenditure. Btw, please don't go to party politics about it, since that is not the issue here, but if more money should had been given for defence and if the ammount that was given is enough.

Is OROP independent of this allocation?

 

[sancho]

Is OROP independent of this allocation?

Jaitly said, he had allocated the funds last year and that it's just a matter of the MoD to clear it, the strange thing however is, that for the most part of last year, he was the Defence Minister too, so he had to clear it. Seems like he is trying to distract from delays and not clearing it as promised during the elections, but lets see what Parrikar does. The much advertised war memorials wasn't cleared last year either from DM Jaitley, although FM Jaitley boasted about the allocated funds in the budget.

 

[MokshaVimukthi]

That's what I said and which is contradicting your earlier statement about fiscal prudance and no, they are not spending it on infrastructure, since the additional money is not allocated to the planned expenditure. Btw, please don't go to party politics about it, since that is not the issue here, but if more money should had been given for defence and if the ammount that was given is enough.

As long as they are targeting a lower deficit how is it NOT prudent ? That does not even make sense.

Its absurd to say only the borrowed money goes into unplanned expenses. It all comes out of the same kitty, planned and unplanned. It makes no difference.

Unplanned expense is ALSO an expenditure which will boost the economy. Its not like they are going to dump that money into the ocean. End of the day ANY money in circulation is Good. You can at worst say that money in unplanned expensed MAY be less productive, but that is pure speculation.

Adequate money was allocated to defence, I am more worried about the education front.

 

[Bang Galore]

https://twitter.com/x/status/572399174219530240

Unlikely the Chief economic advisor wants it go down a bit, rupee too strong for his liking.

 

[MokshaVimukthi]

Unlikely the Chief economic advisor wants it go down a bit, rupee too strong for his liking.

Why on earth would we want the Rupee to be weaker ?

A stronger Rupee will make Oil Cheaper and will make working as slaves in the Gulf not very profitable. It will boost Industry in India since manufacturing will become cheaper.

It will encourage states to focus more on developing their economy and providing employment in India.